New Chinese Mega-Resort Plan Threatens Baja Coral Reef

In mid-June of 2012, following months of protests by environmentalists, the Mexican government announced the cancellation of permits to build a massive resort complex along the shoreline of the only productive coral reef in Baja’s Gulf of California. At the time, a Spanish developer had plans for some 30,000 hotel rooms, golf courses and a marina beside the Cabo Pulmo National Marine Park. But scientific studies showed that marine life had exploded since the reef received protection from overfishing in 1995. This, coupled with Madrid builder Hansa Urbana’s financial instability, resulted in the project’s being abandoned.

But not for long, it turns out. Cabo Cortés has now reared its ugly head as Cabo Dorado. In mid-March, a Chinese consortium submitted an environmental impact statement to Mexican authorities, seeking to construct an “integrally planned development….of 9 hotels totaling 4,080 rooms and 6,141 residences” over a ten-year period. Not to mention 4,380 commercial spaces, restaurants and condos; an improved airfield, a shopping center, several beach clubs, two golf courses, a shooting range and a wellness center. An investment that the developers say will reach $3.6 billion will be scattered across some 9,316 acres. The builders’ press release claims they “will employ directly and indirectly around 18,000 people” and “will have an economic spillover of around $900 million dollars per annum.”

On the “plus side,” the Cabo Dorado plan doesn’t include a marina or a desalination plant – both on the drawing board for the earlier Cabo Cortés project, and both considered to pose huge risks to the marine reserve. The latest developer alleges that the Cabo Dorado Project will maintain “around 67% of the land….as a natural reserve dedicated to the conservation of the environment.” But it’s all to be erected adjacent to what National Geographic has called the most robust coral reserve in the world – home to more than 260 marine species including manta rays, sharks and sea turtles, and a critical stopover for migrating humpback whales. About half a million tons of food (marine nutrients and fish) are exported annually from the park’s environs. It’s a UNESCO World Heritage Site (as of 2005), and a RAMSAR global wetland of international importance (2008).

The Chinese apparently bought the water rights that its Spanish predecessor had put in place, which allow the pumping of more than four million cubic meters annually from the Santiago and Cabo Pulmo aquifers. This is a desert region where rainfall is already down dramatically. (Over the past decade, the supply of water per resident in the nearby Los Cabos municipality has dropped by half.) And the Santiago aquifer is the last remaining water reserve of consequence in all of Baja California Sur. It’s been estimated that the amount of water consumed only by Cabo Dorado’s proposed hotels – without considering water demands from any other infrastructure – would be more than 11 million cubic meters of water per year. That’s almost three times the allotted water rights.

So it makes you wonder where the rest is going to come from. Of course, even if the land deal again goes bust, the developer’s water concession would put them in a position to sell the water back to the people of the area (as the Nestle corporation did in Bolivia). If you find the notion of draining the pesos from the locals a bit diabolical, consider that the newly-elected PRI government just forced through legislation to denationalize and sell off the Mexican oil fields to the highest bidders. Consider, too, that the environmental impact statement for Cabo Dorado was prepared by the same people who did one for the previous Cabo Cortés project. And consider that the Mexican promoter is, yet again, a shadowy fellow in Mexico City named John McCarthy, who used to head up the country’s tourism development agency, Fonatur.

In this case, Mexico’s deal is with La Rivera Desarrollos BCS, holding company of Cabo Dorado properties, with the majority owner being two companies: Beijing Sansong International Trade Group and Glorious Earth Holdings. The latter is based in Irvine, California, founded as Glorious Earth Group in 2013 and privately held. An Internet search doesn’t reveal much that’s glorious. In fact, the company’s website sounds like it was put together by someone just starting to master the English language. It’s allegedly “a construction company with worldwide projection….a solid company with extensive experience in the design and implementation of infrastructure for ground transportation.” Under the heading of “Hydroelectric Plants,” we are informed that “Glorious Earth Group is known for offering our best effort in every work.” Supposedly the company “has huge experience in Renewable Energy,” although nothing is specified. The registered agent for the (not-so) Glorious Earth Group is Yurong Zhang.

As for Beijing Sansong, it’s a multimillion-dollar company whose partners include the top three international contractors by total revenue in the world. The China State Construction and Engineering Corporation, slated to build Cabo Dorado, has completed over 5,000 projects in 116 countries over the past three decades. It reported $57 billion in international revenues in 2011. Two years before that, it was one of seven companies debarred by the World Bank for attempted bid-rigging in a major bank-financed project in the Philippines.

Octavio Aburto-Oporeza is a marine biologist and Assistant Professor at Scripps Institution of Oceanography, whose studies revealed that Cabo Pulmo’s biomass of marine life more than quadrupled in the decade after the reef received protection. As he describes the Cabo Dorado project: “It’s not like asking to build a bathroom in your backyard. If you look at the scale of the project in the long-term, it is building a city of 250,000 people.” Agustín Bravo, Northwest Coordinator of the Mexican Center for Environmental Law, see many factors that could affect the marine reserve, including the large increase in visitors, polluted runoff from golf courses irrigated by treated water, and changes in the sediments that flow into the Sea of Cortés. Bravo has called this “a privatization of environmental services and socialization of environmental liabilities. It’s crony capitalism.”

Clearly, the latest fight to protect the reef and its surrounding environment has only begun. To keep regularly abreast of what’s going on, visit the websites of two grassroots organizations involved in the effort: www.wildcoast.net and www.cabopulmovivo.org.